Marathon Petroleum Thrift Plan Summary Plan Description

Transcription

1 Marathon Petroleum Thrift Plan Summary Plan Description This is merely a summary of the Marathon Petroleum Thrift Plan. This summary was developed to cover only the circumstances applicable to most participants. It does not fully cover all circumstances. If there is ever a conflict between the language of this summary and the legal Plan document, the legal Plan document will be followed. This summary is as of January 1, 2012, unless noted otherwise. This document constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933.

2 Table of Contents I. Purpose... 1 II. Eligibility... 1 III. Joining the Plan... 2 IV. Classes of Membership... 2 Active Member... 2 Member With Account(s) in Suspense... 2 Retired Member... 3 Non-Employee Member... 3 V. Member Contributions... 3 Pre-Tax, Roth Deferral and After-Tax Contributions... 3 Rollover Contributions and Direct-Plan Transfer Contributions... 5 VI. Company Contributions... 5 VII. Maximum Contributions Limitation... 6 VIII. Thrift Plan Accounts... 6 IX. Investment Options... 8 X. Transfers... 9 XI. Vesting... 9 XII. In-Service Withdrawals In-Service Withdrawal of a Portion of Thrift Balance...11 Account and Investment Withdrawal Order for In-Service Withdrawals...12 In-Service Withdrawal of Entire Thrift Balance...12 XIII. Withdrawals After Separation From Service Retired Member, Spouse Beneficiary Member, or Beneficiary Member...14 Member With Account(s) in Suspense...14 Non-Employee Member...15 Reinstatements...15 Re-Entry Into the Plan...16 XIV. Settlement Options Single Sum Payment...16 Installment Option...16 XV. Beneficiary XVI. Loans XVII. Benefits Not Assignable XVIII. Trustee XIX. Plan Year XX. Benefit Claims... 19

3 XXI. Your Rights Under Federal Law Receive Information About Your Plans and Benefits...19 Prudent Actions by Plan Fiduciaries...20 Enforce Your Rights...20 Assistance With Your Questions...21 XXII. Administration of the Plan XXIII. Participation by Other Employers and Employees...23 XXIV. Rollover Contributions or Direct-Plan Transfer Contributions...24 XXV. Modification and Termination...24 Appendix A A Summary of Eligible Transactions by Membership Type...26 Appendix B Special Tax Notice Regarding Plan Payments...27 Appendix C Service With Acquired Companies (or Portions Thereof) Which is Recognized for Vesting Purposes...34 Appendix D Rules Governing the Making of Individual Account Loans...35 Appendix E General Descriptions of Forms of Payment Available Under the Marathon Petroleum Thrift Plan...40 Appendix F Participating Companies in the Marathon Petroleum Thrift Plan...42 Appendix G Thrift Plan Funds as of January 1,

4 Marathon Petroleum Company LP has contracted with Fidelity Institutional Retirement Services Company (Fidelity) to provide recordkeeping services to Thrift Plan members. Most Thrift Plan transactions can be initiated by logging onto Fidelity NetBenefits SM available at or calling Fidelity at , a toll-free number for members in the continental U.S. Members who are hearing impaired may call Fidelity at (TDD). The original Plan was initially put into effect November 1, 1953, and as a result of the spin-off of the downstream related business, this Plan (The Marathon Petroleum Thrift Plan) was created as a spinoff of the original Marathon Oil Company Thrift Plan. I. Purpose The purpose of the Marathon Petroleum Thrift Plan (Plan) is to assist employees in maintaining a steady program of savings, in supplementing their retirement income and in meeting their financial emergencies. II. Eligibility Effective July 1, 2011, any employee of Marathon Petroleum Company LP (Company) or of a participating employer is eligible to become a member of the Plan provided the employee is classified as a Regular Full-time or Regular Part-time employee, is at least age 21, has completed one year of Vesting Service (as described in the Vesting section below ) and is a member of the Marathon Petroleum Retirement Plan. Regular Full-time means the employee has a normal work schedule of at least 40 hours per week or at least 80 hours on a bi-weekly basis. However, if a Regular Full-time employee s normal work schedule is reduced to 20 hours or more per week to accommodate a bona fide health problem or disability, such employee will continue to be eligible for the Plan. Regular Part-time means the employee is a non-supervisory employee who is employed to work on a part-time basis (minimum of 20 hours but less than 35 hours per week) and not on a special job completion, or call when needed basis. Also eligible to participate is any employee classified as a Casual employee who has been compensated or is entitled to be compensated by a participating employer and/or a member of the controlled group for 1,000 hours or more in a service year. Controlled group means Marathon Petroleum Corporation (MPC) and any other corporation, trust or estate, or partnership in which MPC owns, either directly or indirectly, at least 80% of either the voting stock, the total value of shares of all classes of stock, the actuarial interest, the profits interest, capital interest, or beneficial interest. A service year consists of 12 months of service. For calculating vesting service after an employee s first service year of employment, the period for further vesting service calculations is immediately changed to a plan year which runs from January to December of each year. Regular and Casual employees must be specifically designated as such by the Company to be eligible to participate in the Plan. The following individuals are not eligible to participate in the Plan: (a) individuals who have signed an agreement or have otherwise agreed to provide services to the Company, regardless of the tax or other legal consequences of the arrangement; and (b) leased employees, whether or not the leased employee falls within the definition of leased employee as defined in Section 414(n) of the Internal Revenue Code. 1

5 If a member terminates employment and is subsequently reemployed by a participating employer, membership in the Plan may commence on the first day of such reemployment. III. Joining the Plan Membership in the Plan is entirely voluntary and an employee may commence membership on the first of the month coincident with or next following the day the employee has satisfied the eligibility requirements, as provided in Section II. To enroll in the Plan, an employee must: Contact Fidelity at to elect contribution percentages and investment options, and Submit a beneficiary form to Fidelity. IV. Classes of Membership The manner in which a member is permitted to direct their account(s) depends on the class of membership to which the member belongs. See Appendix A for a Summary of Eligible Transactions by Membership Type. The classes of membership are: Active Member An eligible employee of Marathon Petroleum Company LP or a participating employer who is receiving pay and has elected to make contributions to the Plan Member With Account(s) in Suspense A member who transfers at the request of their employer to a nonparticipating employer within the controlled group A member who is on a leave of absence approved by the Company A member who has voluntarily suspended member contributions A Deferred Member who is subsequently rehired by a member of the controlled group A member who is a highly compensated employee and a substantial service employee with respect to Speedway LLC, or its subsidiaries. A Scurlock Permian employee who, on the closing date of the sale of Scurlock Permian (May 18, 1999), continues employment with Scurlock Permian, the purchasing company or any affiliated company. (Former Scurlock Permian employees who are Members with Account(s) in Suspense are entitled to a total distribution from the Thrift Plan.) An employee who was an Active Member but whose status changes from a common law employee to a leased employee (as defined in subject to under Section 414(n) (3)(A) and (B) of the Code) of a participating employer and/or a member of the controlled group. 2

6 Retired Member A member who retires from a member of the controlled group A member who terminates employment from a member of the controlled group on or after age 50 with a vested Thrift account(s) Non-Employee Member Deferred Member A non-vested member who terminates employment, or a vested member under the age of 50 who terminates employment. Spouse Beneficiary Member A beneficiary who was the spouse of an Active Member, Retired Member or a Member with Account(s) in Suspense at the time of such member s death. Beneficiary Member A beneficiary other than a Spouse Beneficiary as defined above. Alternate Payee Member An individual who as the result of a Qualified Domestic Relations Order has been given certain rights relative to a member s account(s). Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Internal Revenue Code. Loan repayments will be suspended under this Plan as permitted under Section 414(u) of the IRC. V. Member Contributions Members may make the following types of contributions to the Plan: Pre-Tax, Roth Deferral and After-Tax Contributions Active Members may elect to make Pre-Tax from 1% to a maximum of 25% of gross pay. Highly compensated employees are limited to a Pre-Tax Contribution maximum of 12% of gross pay. Active Members may elect to make Roth Deferral Contributions from 1% to a maximum of 25% of gross pay. Highly compensated employees are limited to a maximum of 12% of gross pay. Roth Deferral and Pre-Tax contributions combined cannot exceed 25% of gross pay (12% if a highly compensated employee). If an employee becomes a highly compensated employee and the combined Pre-Tax and Roth Deferral contribution is above 12%, Pre-Tax Contributions will be decreased first, then Roth Deferral Contributions will be decreased to meet the 12% guideline. Contributions will be changed to After-Tax contributions, but only to the extent that the total After-Tax contribution does not exceed the After-Tax limits. Also, the dollar amount of Roth Deferral and Pre-Tax Contributions combined may not exceed the maximum annual dollar limit pursuant to Code Section 402(g). Active Members may elect to make contributions on an After-Tax basis from 1% to a maximum of 18% of gross pay. 3

7 Active Members may voluntarily elect to utilize Fidelity s Automatic Increase Program which allows automatic annual increases in Member Contributions by a specified percentage on a specified date, subject to Plan provisions and IRC regulations. Such Automatic Increase Program can be revoked at any time. If an employee reaches their annual Pre-Tax Contribution or Roth Deferral Contribution limit, as established under the Internal Revenue Code, their Pre-Tax or Roth Deferral Contributions will be switched to After-Tax contributions up to the 18% of gross pay limit. Any remaining Pre-Tax or Roth Deferral Contributions will be returned in the employee s paycheck. Eligible Members may elect to make Catch-Up (which includes Roth Catch-Up) Contributions of from 1% to 50% of gross pay received after January 1, 2004, subject to IRC regulations. Catch-up Contributions shall be permitted only for Members who have attained age 50 before the close of the Plan Year and have elected to make Pre-Tax Contributions of at least 7%, unless the Member has already contributed the maximum allowable pursuant to Code Section 402(g). Catch-Up Contributions must be made in accordance with, and subject to the limitations of, the regulations of the Internal Revenue Code. A participant s catch-up contribution election will be honored only to the extent of the participant s available take-home pay after taxes have been withheld and other deferrals, premiums, benefit-related deductibles, and court-ordered deductions have been honored. Roth In Plan Conversion a member may elect to convert all or a portion of their accounts within the Plan that are distributable and eligible for rollover to a Roth Conversion account that is also within the Plan. For an Active Member not yet age 59 ½ or disabled, accounts that are distributable and eligible for rollover generally means their vested Company Matching, Rollover and/or After-Tax accounts. Amounts converted will be included in gross income as if distributed in the year of conversion (except for After-Tax Contributions which have previously been taxed). NOTE: Pre-Tax Contributions are, for tax purposes, excluded from gross pay and are not taxable to the member at the time they are contributed. The primary tax deferral under Pre-Tax is federal income tax. In addition, certain state taxes may be deferred depending on a member s location. A member may elect to change the rate of their contributions or to voluntarily suspend or resume their contributions at any time with each change becoming effective as soon as administratively possible after the Plan has been notified of the change by the Recordkeeper. Gross pay includes pay for hours worked, pay for allowed hours, bonuses, Company pay prior to military pay offset while on military leave, Special General Asset Payments for new hires, Marathon Petroleum Company LP Success Through People (STP) and other annual incentive compensation program payouts; however, bonuses, STP payouts, and other annual incentive compensation payouts paid after a member retires or terminates, signing bonuses, signing payments made on or after March 24, 2005, as a result of the collective bargaining process, travel pay, non-cash awards, or other similar special payments shall be excluded. Effective May 1993, gross pay expressly excludes overseas premiums, temporary hardship allowances, and any other location premiums. For purposes of this Plan, the amount of a member s gross pay shall be calculated so as to include any amount of Pre-Tax (401(k)) Contributions, contributions made to the Marathon Petroleum Company LP Contribution Conversion Plans effective April 1,1990, and contributions to the Health Care Spending Accounts and Dependent Care Spending Accounts after December 31,

8 However, the maximum annual compensation recognized by the Plan for a Plan member may not exceed the amount set forth under IRS rules, as adjusted from time to time in accordance with the law ($250,000 for 2012). Rollover Contributions and Direct-Plan Transfer Contributions Subject to Plan Administrator approval, Active Members, Members with Account(s) in Suspense, and Retired Members may make Rollover Contributions or Direct-Plan Transfer Contributions of qualified distributions from qualified plans of the Company or its subsidiaries, qualified plans of Marathon Petroleum Company LP, its parent and its affiliates, or from any other qualified plan or any conduit IRA. However, Roth Rollover Contributions will only be accepted from another tax-qualified plan. Current and prior Deferred Members may also make rollover contributions as described above, but may not make Direct-Plan Transfers. In certain limited circumstances described in the Plan Text, Rollover Contributions may be accepted from individuals who had previously closed their Thrift account(s) and from individuals who are eligible to become Active Members, but have elected not to contribute to the Plan. Subject to Plan Administrator approval, Spouse Beneficiary Members may make Rollover contributions from qualified retirement plans sponsored by: (i) an employer within the controlled group to which Marathon Petroleum Company LP belongs, or (ii) the qualified retirement plans of any employer whereby the Thrift Plan has recognized vesting time for previous service of the deceased member. Effective January 1, 2000, Rollover Contributions will be permitted from newly hired employees who would otherwise be eligible but who have not yet met the Thrift Plan s membership requirements. These new employees are allowed into the Plan as non-members solely for the purposes of making rollover contributions from eligible qualified plans, and changing investment options. The employee must submit written certification that the rollover is a qualified contribution. All Rollover Contributions or Direct-Plan Transfer Contributions are subject to the terms and guidelines set forth by the Plan Administrator and may be made in lump sum cash, Marathon Petroleum Corporation Common Stock, and/or shares of Eligible Investment Companies. Rollover Contributions must be made by the member within 60 days after the member has received their distribution from such eligible retirement plan or IRA. The member must provide adequate documentation relating to the qualified plan or IRA. VI. Company Contributions Subject to adjustments by the Plan Administrator under IRS rules, the Company will, for any given pay period, match each member s Pre-Tax, Roth Deferral or After-Tax Contributions up to a maximum of 7% of gross pay received during the pay period, dollar-for-dollar, but only out of its accumulated earnings and profits. The Company will not match Rollover Contributions, Direct-Plan Transfer Contributions, Catch-up Contributions or contributions made while a member has been suspended now or at any time in the future. All Company Contributions will be invested in the same manner as the member has directed. If no election is made, all Contributions will be invested in a Pyramis Core Lifecycle Commingled Pool Fund that has a target retirement date closest to the year a member might retire, based on the member s current age and assuming a normal retirement age of 65. 5

9 VII. Maximum Contributions Limitation The Internal Revenue Code (Code) limits amounts going into a member s account in a number of ways, including (1) an overall dollar limit on Pre-Tax and Roth Deferral Contributions, excluding Catch-up Contributions ($17,000 in 2012), (2) limitations on contributions by employees with compensation above levels established by the Code, (3) an overall dollar limit on Catch-up Contributions ($5,500 in 2012) and (4) limitations on annual additions. The total annual addition to a member s account(s) (from employee and employer contributions as well as forfeitures but excluding Catch-Up contributions) for any calendar year cannot exceed the lesser of $50,000 (for 2012) or 100% of the member s compensation for that year. In addition, a member s gross pay that may be taken into account under the Plan is limited to the IRS annual compensation limit ($250,000 for 2012) as established under the Code. Effective February 5, 1999, amounts contributed in excess of the participant s annual limitation including applicable earnings will be forfeited from the participant s Company Matching Contributions account and placed in an unallocated suspense account. These amounts will be used to reduce future Company contributions to the Plan. VIII. Thrift Plan Accounts Each member s contributions to the Plan and allocations of gains and losses are accounted for using the following accounts: Pre-Tax Account This account contains all Pre-Tax Contributions and related earnings. Pre-Tax Catch-Up Contribution Account This account contains all Catch-Up Contributions made by eligible members on or after October 1, 2002, and the related earnings. After-Tax Account This account contains (1) all post-1986 tax-paid contributions and related earnings, and (2) all pre-1987 tax-paid contributions and related earnings. A separate subaccount of this account contains the pre-1987 tax-paid contributions and related earnings. Roth Deferral Contribution Account This account contains Roth Deferral Contributions and the related earnings. Rollover Accounts Pre-tax rollover account Contains all pre-tax monies contributed to the Plan and related earnings, as the result of a rollover from another tax qualified plan or IRA. After-tax rollover account Contains all after-tax monies contributed to the Plan and related earnings, as the result of a rollover from another tax qualified plan. 6

10 Company Matching Account This account contains all Company Contributions and related earnings. Roth Catch-Up Account This account contains all Roth Catch-Up Contributions and related earnings. Roth Rollover Account This account contains all Roth Deferral amounts that have been rolled over from another tax-qualified plan and the related earnings. Roth In-Plan Conversion Account This account contains amounts that have been converted and the related earnings. Pre-Tax Versus After-Tax/Roth: An Example What is the impact of pre-tax Pre-Tax Contributions versus After-Tax/Roth Contributions? Here is a comparison between an 8% Pre-Tax Contribution and an 8% After-Tax/Roth Contribution. The following tax calculations are based on the 2012 Federal Tax Withholding Schedule; single based on single tables and married based on married-filing jointly tables with two exemptions. In the example below only Company salary was taken into consideration. Since a two-income household may be taxed at a higher rate, participation in Pre-Tax may result in greater annual net pay when compared to traditional After-Tax/Roth savings. Federal Withholding Schedule Effective January 1, 2012 Single One withholding allowance = $3,800 Married Two withholding allowances = $7,600 After-Tax/Roth Pre-Tax After-Tax/Roth Pre-Tax Annual Pay $ 50,000 $ 50,000 $ 50,000 $ 50,000 Pre-Tax Contribution 0 $ 4,000 0 $ 4,000 Taxable Pay (= Annual pay less withholding allowance and Pre-Tax) $ 46,200 $ 42,200 $ 42,400 $ 38,400 Federal Tax $ 7,043 $ 6,043 $ 4,275 $ 3,675 Pay Minus Federal Tax $ 42,957 $ 39,957 $ 45,725 $ 42,325 After-Tax/Roth Contribution $ 4,000 0 $ 4,000 0 Net Pay (before other taxes $ 38,957 $ 39,957 $ 41,725 $ 42,325 and deductions) This example does not take into consideration the impact of tax deferral under the income tax laws of a number of states. 7

11 IX. Investment Options The Plan offers a wide range of active investment options, available online at the Fidelity NetBenefits SM website ( and in Appendix G, in which members may direct monies and hold balances. The investment options available in the Plan are structured in four distinct groups or tiers: Tier 1 Core Funds, Tier 2 Pyramis Commingled Pool Funds, Tier 3 BrokerageLink, and Tier 4 Other Funds which contains Marathon Petroleum Corporation stock and the frozen investment options. There is no guarantee of either investment return or safety of principal in any of the Plan s investment options, although the various choices represent different investment objectives and risks. The Plan Administrator has the authority under the Plan to add new investment options or eliminate current investment options at any time. Frozen investment options may hold balances but no additional contributions or exchanges may be directed into them. Members can direct the investment of their contributions being invested in their Pre-Tax, Roth Deferral, After-Tax, and Rollover Accounts. A member s investment option election applies to all accounts including the Company Matching Accounts. If no elections are made, Company Contributions will be invested in the Pyramis Commingled Pool Fund that has a target retirement date closest to the year a member might retire, based on the member s current age and assuming a normal retirement age of 65. Monies may be invested in any active investment option in increments of 1%. Prior to investing in any of the Plan s mutual fund investment options, including those available through BrokerageLink, members should first obtain and review a copy of that fund s prospectus. Prospectuses are available for all of the core mutual fund investment options by logging onto Fidelity NetBenefits SM at or calling the Recordkeeper, Fidelity, toll free at Individual mutual funds may have rules and penalties governing transaction limitations (excessive or abusive trading stipulated by Fidelity). Such rules and penalties can generally be found in the Fund s prospectus. Fund prices are available at the same number and most newspapers publish information on all of the mutual fund investment options offered by the Plan. A member may change their investment option(s) in either the Pre-Tax Account, Roth Deferral Account or the After-Tax Account at any time with each change becoming effective as soon as administratively possible. Participants who have invested in the Plan s Marathon Petroleum Corporation common stock investment option have the right to direct voting of the number of shares held in that investment option of their account pursuant to the Plan s Trust. The Plan s Trust requires that information regarding participant voting of shares be kept confidential by the Trustee. This includes, but is not limited to, participant voting in response to a tender offer. The Trustee is responsible for implementing this requirement and the Plan Administrator as named fiduciary has authority to establish administrative procedures to ensure the confidentiality requirement is enforced. Some investment options may pay dividends from time to time. Dividends and interest will be directed to the option, which generated such dividend and interest even if the member is no longer contributing to that option. The exception is frozen MRO stock dividends which shall be reinvested according to the investment election in force at the time such dividend becomes payable. 8

12 The Marathon Petroleum Thrift Plan has two levels, Investment Advice and Account Management, of professionally managed account services and investment advice for Plan participants offered through Financial Engines. The Investment Advice option provides participants with specific fund recommendations and an easy to follow action plan for their execution. There is no additional cost to the participant for this service. With the Account Management option, participants delegate decision making authority to a registered investment adviser who researches and analyzes the options available in the Plan, creates a customized investment strategy, and provides on-going account monitoring and rebalancing. Participants utilizing this option will pay a management fee based on the size of the account balance. X. Transfers Subject to administrative procedures established under the Plan, a member may at any time direct the Trustee, Fidelity Management Trust Company, to sell any or all of the assets in the member s account(s) in whole percents, shares/units, or dollar increments and at the same time inform the Trustee how to distribute the proceeds of such sale into other investment options. The member may direct the Trustee to execute Transfers daily, subject to administrative procedures established under this Plan. When the member directs the Trustee to buy or sell investments, the member will receive or pay the share price when executed. Members are not permitted to make a direct exchange from Cash with Interest to Fidelity Government Money Market Portfolio or to Fidelity Retirement Money Market Portfolio (considered competing funds.) Before exchanging from Cash With Interest, members must first exchange to a noncompeting fund for 90 days. Information on Member Accounts Members can obtain information on their account(s) in the following ways: By calling Fidelity at , Online at the Fidelity NetBenefits SM website ( or Through the quarterly statement made available to each member. XI. Vesting A member is fully and immediately vested in their member contributions, including Pre-Tax Contributions, Roth Deferral Contributions and After-Tax Contributions. Although Company Contributions are credited to the Company Matching Account and are invested in accordance with the member s investment option elections, the member cannot withdraw any Company Contributions until a vested right is acquired in such contributions by the member. A member shall acquire a fully vested, nonforfeitable right to all the Company s Contributions and the earnings thereon upon the earliest of the following: 9

13 A. Upon the completion of: 3 years of service if the member has performed an hour of service on or after January 1, 2002, or 5 years of service if the member has performed an hour of service on or after January 1, 1989, but not after December 31, B. Upon attaining the Plan s normal retirement age (age 65). C. Retirement under the Marathon Petroleum Retirement Plan, as then in effect. D. The death of an Active Member or a Member with Account(s) in Suspense. A member shall be credited with a year of service if the member is compensated or entitled to compensation by a participating employer and/or a member of the controlled group for 1,000 hours or more in a service year. For purposes of the 1,000-hour test, non-exempt employees shall have actual hours worked counted; exempt employees shall have 45 hours counted for a weekly payroll and 90 hours counted for a bi-weekly payroll; non-exempt and exempt members on an approved leave of absence shall have 45 hours counted for a weekly payroll and 90 hours counted for a bi-weekly payroll. A service year consists of 12 months of service. For calculating vesting service after an employee s first service year of employment, the period for further vesting service calculations is immediately changed to a plan year which runs from January to December of each year. The first calendar year measurement period will be the calendar year that includes the first anniversary of the date the employee first performs an hour of service. In addition, members shall receive service credit for time during which (1) a member is laid off (if such lay off is for less than 12 consecutive months); (2) a member s account(s) is held in suspense pursuant to a Complete Withdrawal; or (3) a member is a leased employee (as defined in the Code) for a participating employer and/or a member of the controlled group. Refer to Appendix C for information relative to service with acquired companies which is recognized for vesting purposes. For purposes of eligibility and vesting, previous MPC Controlled Group service will be recognized as follows: A. Effective January 1, 1998, the Marathon Petroleum Thrift Plan will recognize a new hire s previous Speedway LLC vesting service back to January 1, 1998, for purposes of eligibility and vesting. B. The Marathon Petroleum Thrift Plan will recognize previous Marathon Petroleum Company LP vesting service for purposes of eligibility and vesting. C. For new hires with service with an employer of the Controlled Group, other than described above, vesting service will be recognized for eligibility and vesting as presently defined in the Plan. For hires to MPC with service with an employer of the controlled group of Marathon Oil Corporation, their service with an employer of the controlled group of Marathon Oil Corporation through the Distribution Date, will count for vesting and eligibility under the Thrift Plan. For hires to MPC with service with an employer of the controlled group of Marathon Oil Corporation, their service with an employer of the controlled group of Marathon Oil Corporation after the Distribution Date will not count for vesting and eligibility under the Thrift Plan. For Delayed Transfer Employees, as defined in the Employee Matters Agreement, their service through the date of transfer will count for vesting and eligibility under the Thrift Plan. 10

14 D. For any new hires (non-transferees) to any participating employer with previous employment with USX or U.S. Steel and the wholly-owned subsidiaries of USX Corporation, their service between March 11, 1982 and the December 31, 2001 effective date of the U.S. Steel spin-off from USX will count for vesting and eligibility purposes. For these non-transferees, service with United States Steel Corporation on or after the December 31, 2001 effective date of the spin-off will not count for vesting and eligibility purposes under the Thrift Plan. Other than described above, if a former employee of a participating employer is hired (for reasons other than a transfer) by a nonparticipating member of the controlled group, or a former employee of a member of the controlled group is hired (for reasons other than a transfer) by a participating employer, vesting service time within the controlled group shall be recognized for purposes of vesting service under this Plan provided that such vesting service is attributable to time while the employer(s) was a member of the controlled group. If a former member or Retired Member is subsequently reemployed by a participating employer, all prior service which has been credited for vesting purposes hereunder, shall be reinstated. Notwithstanding anything herein to the contrary, employees who are terminated within 24 months of a Change of Control (as defined in the Thrift Plan text) will become immediately vested in the Marathon Petroleum Thrift Plan. XII. In-Service Withdrawals Notwithstanding the distribution options described below, the Plan will apply the minimum distribution requirements of section 401(a)(9) of the Internal Revenue Code to Members who have attained age 70 1 /2 and to their beneficiaries, as applicable, as described in Appendix E of the Thrift Plan text. This shall be in effect until the end of the calendar year beginning before the effective date of final regulations as published by the Internal Revenue Service. In-Service Withdrawal of a Portion of Thrift Balance An Active Member or a Member with Account(s) in Suspense is eligible to withdraw a portion of their After-Tax, Rollover and/or Company Matching Accounts subject to the provisions outlined below: No In-Service Withdrawal of less than $100 will be permitted. If a vested or non-vested member makes an In-Service Withdrawal that reduces the total balance in the member s account(s) to an amount which is less than the Plan minimum, then the member will be subject to a suspension penalty. The suspension penalty requires that Company Matching Contributions will cease as soon as administratively possible and will resume following the six-month anniversary of the withdrawal. During the suspension period, the member may make unmatched Pre-Tax Contributions, Pre-Tax Catch-Up Contributions, After-Tax Contributions, Roth Deferral Contributions, Roth Catch-Up Contributions, Rollover Contributions, Roth Rollover Contributions and Direct-Plan Transfer Contributions. In-Service Withdrawals are limited to a maximum of four (4) in a Plan Year. In-Service Withdrawals may be made in cash and/or securities. Withdrawals (excluding complete withdrawals in excess of $35,000) can be initiated online at the Fidelity NetBenefits SM website ( or by calling Fidelity at Proceeds may be transferred electronically to a bank account for withdrawals initiated online. 11

15 Notwithstanding the foregoing, Non-employee Members will be permitted to make a one-time withdrawal to pay off outstanding Thrift Plan loans. This one-time withdrawal must occur within 60 days of the date of becoming a Non-employee Member. An Alternate Payee Member may also take a one-time withdrawal within 90 days of the date a respective QDRO is determined to be qualified. Account and Investment Withdrawal Order for In-Service Withdrawals Unless elected otherwise by the member, the order in which funds from the Plan are withdrawn is as follows, with the type of account taking precedence over the type of investment: Account: 1. Pre-1987 tax-paid employee contributions in the After-Tax Account 2. All remaining funds in the After-Tax Account 3. Rollover Account After-Tax 4. Rollover Account Pre-Tax 5. Company Matching Account 6. Pre-Tax Account (to the extent permitted by the Plan and by law) 7. Pre-Tax Catch-Up Contribution Account 8. Roth Deferral Contribution Account 9. Roth Catch-Up Contribution Account 10. Roth In-Plan Conversion Account 11. Roth Rollover Contribution Account Investments: The order in which funds will be redeemed will be based on a predetermined order as specified at the Fidelity NetBenefits SM website ( For withdrawals from an account in an order other than specified at the Fidelity NetBenefits SM website, members should call the Marathon Petroleum Thrift Plan Service Center at The member may elect a different order than indicated at Fidelity NetBenefits SM provided that all pre-1987 tax-paid employee contributions must be distributed before any funds from the Company Matching and Rollover Accounts may be withdrawn. In-Service Withdrawal of Entire Thrift Balance An Active Member or a Member with Account(s) in Suspense may request an In-Service Withdrawal of their entire Thrift Balance. The amount available for this withdrawal depends on the member s age, disability status, vested status, and employment date as follows: Vested members A vested member who has not attained age 59½ will receive the value of their After-Tax, Rollover, Roth Rollover and Company Matching Accounts. A vested member who has attained age 59½ or who is disabled (as defined below) will receive the value of their above mentioned accounts plus the value of their Pre-Tax, Pre-Tax Catch-Up, Roth Deferral and Roth Catch-Up Contribution Accounts as well as the value of their Roth In Plan Conversion Account. 12

16 Non-vested members A non-vested member who has not attained age 59½ and who is not disabled will receive the value of their After-Tax and Rollover Accounts, excluding their Roth Rollover Account. A non-vested member who has attained age 59½ or who is disabled will also receive the value of their Pre-Tax, Pre-Tax Catch-Up Contribution, Roth Rollover, Roth Deferral Contribution and Roth Catch-Up Accounts. For purposes of this Plan, members will be considered disabled if either: 1. They have been disabled for at least two (2) years, and are wholly and continuously disabled to the extent that they are unable to engage in any occupation or perform any work for gainful compensation or profit for which they are, or may become, reasonably qualified by education, training, or experience, or 2. They can provide proof of a Social Security determination of disability. Reinstatements Any Company Contributions and earnings thereon forfeited upon an In-Service Withdrawal will be used to reduce the Company s subsequent contributions to the Plan. However, the forfeited Company Contributions and earnings thereon attributable to a given In-Service Withdrawal shall be reinstated if, within five (5) years after the date of the withdrawal, the member repays an amount equal to the lesser of: (1) the Company Contributions and earnings thereon credited to their Company Matching Account for the preceding 24 months in which they contributed to the Plan prior to the In-Service Withdrawal, or (2) the amount of the In-Service Withdrawal. An Active Member is not eligible for reinstating contributions during such member s suspension period under the Plan. The maximum an Active Member may repay is their After-Tax Contributions, and, if applicable, Pre-Tax and Roth Deferral Contributions, the total of which must not exceed the amount of their previous In-Service Withdrawal. Reinstated contributions by an eligible member are deposited into the After-Tax Account. If contributions are attributable to pre-1987 Tax-Paid Credit Balance (TPCB) amounts, such contributions are deposited into the pre-1987 subaccount which is a part of the After-Tax Account. Re-Entry into Plan Any former member, after having taken an In-Service Withdrawal of their entire Thrift Plan balance, may re-enter the Plan immediately but will not be permitted to receive any matching Company Contributions until their suspension period has passed. During the suspension period unmatched contributions will be permitted. The suspension time will only count as service toward vesting under the three (3) years of service vesting provision. XIII. Withdrawals After Separation From Service Notwithstanding the distribution options described below, the Plan will apply the minimum distribution requirements of section 401(a)(9) of the Internal Revenue Code to Members who have attained age 70 1 /2 and to their beneficiaries, as applicable, as described in Appendix E of the Thrift Plan text. Company Contributions are forfeited for non-vested members on the earlier of a complete In-Service Withdrawal or five (5) years after the date when a member is no longer an Active Member or a Member with Account(s) in Suspense. A vested member is entitled to receive their entire vested Thrift account when the member is no longer an Active Member or a Member with Account(s) in Suspense. 13

17 The following members may elect to defer the commencement of benefits until no later than the April 1 immediately following the calendar year in which such members attain age 70 1 /2: Retired Members and Deferred Members with a vested Thrift Plan balance in excess of $5,000*, All Members with Account(s) in Suspense, and Non-employee Members (other than Non-employee Members with a vested Thrift Plan balance of $5,000* or less, Beneficiary Members, and Spouse Beneficiary Members.) Withdrawals (excluding complete withdrawals in excess of $35,000) can be initiated online at the Fidelity NetBenefits SM website ( or by calling Fidelity at Proceeds may be transferred electronically to a bank account for withdrawals initiated online. Spouse Beneficiary Members with a Thrift Plan balance in excess of $5,000* may maintain an open Thrift Plan account(s) for their lifetime, subject to the minimum distribution requirements of Code Section 401(a)(9). Spouse Beneficiary Members with a Thrift Plan balance of $5,000* or less must commence their final settlement no later than 60 days after the close of the Plan Year during which they become a Spouse Beneficiary Member. Beneficiary Members may maintain an open Thrift account(s) until no later than the fifth anniversary of the date of the member s death. All other Non-employee Members with a vested Thrift Plan balance of $5,000* or less may maintain an open Thrift account(s) until no later than 60 days from the date of becoming such members unless, in the case of an Alternate Payee Member, the distribution of any part of such Thrift Plan balance is then not permitted under the Qualified Domestic Relations Order. Plan balances will be distributed to such members in the form of a lump sum in cash without their consent at the expiration of their allowed deferral period. Effective January 1, 2002, account balances attributable to rollover contributions are excluded in determining a participant s eligibility to receive a $5,000* de minimus distribution. Withdrawal rights after separation from service are as follows: Retired Member, Spouse Beneficiary Member, or Beneficiary Member May withdraw during any year all or any portion of the remaining balance in their account(s), provided that no withdrawal of less than $500 may be made unless it constitutes the entire remaining balance. Such withdrawals, however, are limited to a maximum of four (4) in a Plan Year. Member With Account(s) in Suspense May take In-Service Withdrawals as defined under In-Service Withdrawals. * Retired Members and Deferred Members with a vested Thrift Plan balance of $5,000 or less at the time they become such a member may maintain an open Thrift account(s) until no later than 60 days after their retirement date or termination date, as applicable. 14

18 Non-Employee Member May make: (1) a one-time In-Service Withdrawal to pay off an outstanding Thrift Plan loan(s), and (2) an In-Service withdrawal of their entire Plan balance. It is provided, however, that an Alternate Payee Member may take a complete distribution of Pre-Tax monies at any time if provided by their Qualified Domestic Relations Order. An Alternate Payee Member may also take a one-time partial withdrawal within 90 days of the date a respective QDRO is determined to be qualified. The member s account(s) will be distributed as the member directs. The member may elect to receive payment in cash or to receive the securities plus any cash balance to which the member is entitled. The Trustee shall make distribution in the manner the member requests so far as it is practicable; but if the member fails to make an election within a reasonable time, payment shall be made in cash. Reinstatements Except as otherwise provided in the Plan, any Company Contributions and earnings thereon forfeited by a member s termination prior to vesting will be used to reduce the Company s subsequent contributions to the Plan. However, the forfeited Company Contributions and earnings thereon attributable to the member s termination prior to vesting shall be reinstated if the member is rehired by a participating employer, and, within five (5) years after the date of rehire, repays an amount equal to the lesser of: (1) the Company Contributions and earnings thereon credited to their Company Matching Account for the last 24 months in which they contributed to the Plan, or (2) the amount of the Plan distribution received upon termination of employment. The maximum an Active Member may repay is their After-Tax Contributions, and, if applicable, Pre-Tax and Roth Deferral Contributions, the total of which must not exceed the amount of their previous total distribution. Reinstated contributions by an eligible rehired employee are deposited into the After-Tax Account (if attributable to pre-1987 Tax Paid Credit Balance amounts, such contributions are credited to the pre-1987 subaccount.) In any case, the rehired employee shall have reinstated towards vesting the total number of months for which contributions were matched prior to the member s complete withdrawal. For the purposes of this reinstatement provision, a Deferred Member who was a non-vested member with a Thrift Plan balance in excess of $5,000 at the time of termination of employment and who has maintained an open Thrift account(s) through the date of reemployment, if any, by Marathon or any member of the controlled group occurring within five (5) years of the last termination from the controlled group, shall be deemed to have taken a distribution of the balance in such account(s) upon termination of employment, and to have repaid the amount of that distribution on the date of reemployment. Rollover Contributions or Direct-Plan Transfer Contributions (as such terms are defined in the Code and applicable regulations) may be recognized as contributions for purposes of satisfying the reinstatement provisions, provided such contributions are made within five (5) years after the date of last termination from a member of the controlled group. 15

19 Re-Entry Into the Plan A former member who is rehired is eligible to become a member of the Plan immediately. However, if a former member is rehired within 6 months from the date of their final settlement, such member will be permitted to make After-Tax, Pre-Tax, Roth Deferral and Catch-Up Contributions but will not receive Company Contributions for a period of 6 months from the date of final settlement. Appendixes B and E contain important information (including participants Direct Rollover rights) regarding Plan payments. XIV. Settlement Options Single Sum Payment Unless the member elects otherwise and except as provided below, distribution of their account(s) will be made in a single sum payment, in either cash or in securities, plus any cash balance to which the member is entitled. Effective March 28, 2005, mandatory distributions valued over $1,000 will be automatically rolled over to an IRA unless elected otherwise. All distributions made by the Plan will satisfy the IRS minimum distribution requirements. Notwithstanding anything herein to the contrary, Plan balances of members, other than Active Members and Members with Accounts in Suspense, will be distributed to such members in the form of a lump sum in cash without their consent if the vested Plan balances have a balance equal to $5,000 or less. Effective January 1, 2002, account balances attributable to rollover contributions are excluded in determining $5,000 balances. Payments from the Plan may be eligible rollover distributions. That means that they can be rolled over to an IRA or to another employer plan that accepts rollovers. Appendix B contains important information about eligible rollover distributions and mandatory income tax withholding. Installment Option Retired Members of any age, Active Members age 70 1 /2 and over, and Spouse Beneficiary Members may elect the Installment Option. Under this Option, the balance of the funds in a member s account(s) will be distributed in not less than three annual (six semi-annual or 36 monthly) installments and not more than the number of annual installments (or the number of monthly or semi-annual installments) which is equal to the actuarial life expectancy of the member (not the joint life expectancy of a member and their spouse) at the time of commencement of benefits under the Installment Option. Life expectancy is based on the Single Life Actuarial Table published under IRS ruling To satisfy the substantially equal periodic payments exception under IRC Section 72(t), the amortization method utilized to determine annual installments will use the interest rate of 120% of the federal mid-term with annual compounding determined no earlier than two months before the month of the first installment payment date as the maximum allowable interest rate assumption and 1 /2% as the minimum allowable interest rate assumption. After benefits commence under the Installment Option, the member may elect to discontinue receiving further installments at any time. A Retired Member and a Spouse Beneficiary Member may be permitted to take a Retired Member Withdrawal and an Active Member age 70 1 /2 and over may be permitted to take an 16

20 In-Service Withdrawal during the payout period of the Installment Option. If a member dies during the payout period under the Installment Option, the installment payment will cease and any further benefits with respect to the member s account(s) will be payable pursuant to the Plan provisions. Members may elect annual or semi-annual installments to be paid in cash and/or securities. Monthly installments may only be paid in cash. All inquiries and transactions involving installment payments are handled by Fidelity via the Fidelity NetBenefits SM website ( or by calling Fidelity at Installment payments initiated online may have proceeds electronically deposited to a bank account. (EFT services are not available for telephone-initiated transactions.) Effective April 1, 2002, any new installment elections or changes to current elections result in proceeds being redeemed in the order described in the In-Service Withdrawal of a Portion of Thrift Balance section, with the type of account taking precedence over the type of investment. The Plan will apply the minimum distribution requirements of section 401(a)(9) of the Internal Revenue Code to Members who have attained age 70 1 /2 and to their beneficiaries, as applicable, as described in Appendix E of the Thrift Plan Text. Minimum required distribution withdrawals for retirees will be distributed in the order described in the In-Service Withdrawal of a Portion of Thrift Balance section. Retired Member withdrawals taken after any minimum distribution requirements have been satisfied, can be withdrawn in the order elected by the Retired Member. Special Note About Distributions The settlement options described here may or may not be advantageous to individual members. There are many Tax and personal considerations to be taken into account before a member makes a selection, and it is recommended that the member obtain qualified, professional advice before making any selection. Neither the Company nor any of its representatives are authorized to give such advice. XV. Beneficiary Each member shall designate a beneficiary or beneficiaries, subject to any requirements established by the Plan Administrator, and may change this designation at any time. If a married member has a beneficiary designation which results in the member s spouse not being the member s sole beneficiary, such designation must be consented to by the spouse in writing on forms approved by the Plan Administrator and witnessed by a Notary Public. The Plan shall only recognize beneficiary designations submitted to the Plan on forms approved by the Plan Administrator. Any beneficiary designation shall be effective only after it is accepted by Fidelity on behalf of the Plan Administrator and the Plan s procedure for determining a beneficiary shall be controlling over any disposition by will or otherwise. Beneficiary changes need to be made on a form provided by Fidelity. Call to request a copy or print after logging on to your account at 17